QSG (Quick Start Guides)

Overview

Quick Start Guides seek to achieve what their name implies, by providing a basic introduction to, and overview, of the area which each covers.

QSGs are provided on Outcomes-Focused Regulation; Outcomes and Overriding Principles; the CLC Handbook and Code of Conduct for those new to a regulatory approach which is focused upon delivery of positive Outcomes and principled behaviours.

Accounts Code

Outcomes-focused
All members of the CLC-regulated community must deliver the following Outcomes:

Clients receive an honest and lawful service (Code of Conduct Outcome 1.2)

Appropriate arrangements, resources, procedures, skills and commitment are in place to ensure Clients always receive a high standard of service (Code of Conduct Outcome 2.3)

Each Client’s best interests are served (Code of Conduct Outcome 3.1).

Delivery of these Outcomes requires the following:

Client Account
You use Client’s money only for that Client’s matters and only pay into, and withdraw money from, the Client and Office Accounts for purposes relating to the provision of CLC-regulated services. You account to the Client, and pay Client money into the Client Account, in a timely manner. Money held in the Client Account is immediately available. Money held in a Separate Designated Account is not aggregated with other monies. Money other than Client Money can only be paid into/held in the Client Account in 3 limited circumstances (set out at 10.4 of the Code). You can withhold money from the Client Account if so instructed by the Client or the CLC.

Should you discover any misappropriation of Client Money you notify the CLC without delay.

There should be no debit balance on the Client side, nor credit balance on the Office side, of a Client Ledger Account. Round sum withdrawals on account of Costs or Disbursements are not permitted; neither is the retention of undrawn Costs or Disbursements due to current – or in anticipation of future – shortages/errors.

You may withdraw money only when properly required: for payment to/on behalf of a Client; payment of a Disbursement on behalf of a Client; reimbursement of money already expended or incurred liability by you out of the Office Account on behalf of a Client; transferred to another Client Account; or where we
have given permission for a specific payment or approved an automated payment scheme. You quickly withdraw: money incorrectly paid into it; Office Money no longer necessary to maintain a Client Account; monies which you were previously unsure whether wholly Office Money; or to pay a bill of costs received by a Client. Money withdrawn does not exceed the total held to credit of both the Client and the Client Account. Any withdrawal in your favour is recorded in both the Client and Office columns of the appropriate Client Ledger Account.

Cash withdrawals are not permitted. Withdrawals made by cheque or other written instructions must
be signed, and other payments including electronic payment systems made, or the systems operated by, an Approved Person (please see CLC Handbook’s Glossary of Terms). With the exception of Separate Designated Accounts, transfers of money from one Client Account to another at the same Bank/Building Society can be carried out by someone other than an Approved Person. A private loan sum can only be paid out of funds held for the lender if you have obtained the written authority of both Clients.

Accounting Records
These are updated at least weekly and show clearly – i.e. illustrate every transaction relating to each Client
and disclosing indebtedness – all dealings with Client Money and Office Money. Client Money dealings are appropriately and clearly recorded (in a Client cash account or record of sums) on the Client side of a
separate Client Ledger Account for each Client/matter. If Separate Designated Accounts (SDAs) are used, the combined cash account and separate amounts are clearly recorded. Where interest has been credited
to the SDA the Accounting Records reflect this. The current balance on each Client and Office Ledger Account and Office Money dealings relating to a Client is readily ascertainable. A record of all bills of costs is maintained and each bill distinguishes between Costs, paid, and unpaid, Disbursements.

Reconciliations
On an at least monthly basis a bank reconciliation statement is prepared to show causes for any differences between Client cash account and Client bank statements and passbook balances. At the same time you prepare a list of all balances shown by client and office ledger accounts to compare the client ledger credit balance with that on the reconciliation statement. Reconciliation statements must run consecutively and be completed within 7 days of the date to which they are prepared. Accounting Records and Reconciliation Statement are kept separate from those for any other business. They, along with, statements and passbooks of accounts in which Client Money has been paid, as well as those of the Office
Account, are retained for at least 6 years. Copies of paid cheques, and original/copies of all other withdrawal authorities, are retained for 2 years.

Deposit Interest
A reasonable rate of interest is sought for any Client Money to be held in an SDA. Your account
to the Client for interest earned. If you decide to depart from this you provide the Client with sufficient information, including any Terms of Engagement contracting out provision, to enable them to make an informed decision.

Accountant’s Reports
An Accountant’s Report is delivered to the CLC within 6 months of the end of the Accounting Period (please see Handbook’s Glossary of Terms). The Reporting Accountant is certified by one of the CLC recognised accountancy bodies (listed at 16.6 of the Accounts Code) and is not a partner, employee or officer of the entity. Should they change their identity, address, or other relevant information, you inform us. The Terms of Engagement include the wording set out (at 18 of the Code); they are signed by both parties and a copy is issued to the Accountant. You provide them with details of all relevant accounts. The Accounting Records are examined at your premises. You can decline a request to produce a document if the Client has so instructed.

Code of Conduct

Your regulatory responsibilities are set out in the CLC Handbook. The Handbook begins with the Code of Conduct. This is the parent document of the regulatory arrangements; all other Codes support it. The Code sets out the 6 Overriding Principles with which you must always comply and the 20 Outcomes which you must deliver:

Overriding Principle 1.
Act with independence and integrity
You do not compromise your independence, integrity, another person, the law or the legal profession. A Reserved Legal Activity is carried on only through an Authorised Person entitled to do so and when acting as a CLC licensee you accept instructions only in CLC regulated matters. Client money is kept safe, and entirely separate from other money.

You do not conduct your business under a misleading name, nor publicise it through unsolicited communications in person or by phone. Advertising is not misleading.

Business communications and media confirm you are regulated by us and identify all Managers. In doing so, you should deliver the following Outcomes:

Overriding Principle 2.
Maintain high standards of work
The entity is controlled from a permanent fixed address in England or Wales.

You comply with any undertaking you give and provide the client with the appropriate level of service, and within a reasonable timescale, agreed with them. You keep your own skills and legal knowledge up to date. You
ensure all individuals within the entity are competent to do their work and that the quality of their work in Client matters is supervised by an Authorised Person Manager and regularly checked. There are supervision arrangements in case of unforeseen events.

You identify and mitigate risks and promote regulatory compliance; and maintain records to evidence how arrangements and controls are applied. Staff are able to raise concerns which are acted upon.
In doing so, you should deliver the following Outcomes:

2.1 Clients are provided with a high standard of legal services;

2.2 Client matters are dealt with using care, skill and diligence; and

2.3 Appropriate arrangements, resources, procedures, skills and commitment are in place to ensure Clients always receive a high standard of service.

Overriding Principle 3.
Act in the best interests of Clients
You keep the Client’s interests paramount and only recommend something/someone when it is in their best
interests to do so. You do not act for a Client where it is not in their best interests to do so, nor act for a Client whose interests conflict directly with your own, the entity’s or another Client’s. When representing parties with different interest in a transaction each party is represented by different Authorised Persons conducting themselves as though members of different entities. You cease acting if the Client instructs, or in the absence of instructions where reasonable to do so.

You only provide Reserved Legal Activities whilst you have CLC-approved Professional Indemnity Insurance (PII) in force.

You have adequate arrangements for claims made after you have ceased to practice. Should you seek to exclude/ limit liability it is above the minimum cover level provided by CLC-approved PII and the Client provides you with written informed consent. When providing services not regulated by us you inform your Client of this and that the activity is not covered by PII, the CLC Compensation Fund or the Legal Ombudsman complaints scheme.

You advise the Client of the name/status of the person dealing with their matter and the person with overall supervision. You disclose Client information only as they instruct and keep records of this.

You provide the Client with accurate and useful information, including that relating to any fee arrangements and changes. You consult with Clients on key decisions and promptly advise them of significant changes to projected costs, timelines and strategies. You discuss/agree with the Client how costs will be paid and promptly inform them in writing of the existence/ amount of a sum payable due to instructions. You do not delay completion because fees (other than disbursements) are outstanding. In doing so, you should deliver the following Outcomes:

3.1 Each Client’s best interests are served;

3.2 Clients receive advice appropriate to their circumstances;

3.3 Clients have the information they need to make informed decisions;

3.4 Clients are aware of any referral arrangements and that they are consistent with your responsibilities both to them and to the CLC;

• 3.5 Clients are aware of any limitation or any condition resulting from your relationship with another party; and
• 3.6 Clients’ affairs are treated confidentially (except as required or permitted by law or with the Client’s consent).

Overriding Principle 4.
Comply with your duty to the court
(applicable should the CLC’s application to regulate litigation and advocacy be successful and you have been authorised to deliver these services.)

You protect and promote the Client’s best interests. You assist the court in the administration of justice and
do not mislead or deceive it. You ensure the court is informed of all relevant decisions, legislative provisions and any relevant legal or factual matters likely to have a material effect on the proceeding’s outcomes. You comply with any Court Order and advise your Client to do so. You protect sensitive evidence and safeguard the well-being of vulnerable persons, including children.

In doing so, you should deliver the following Outcomes:
Outcomes:

4.1 You act in the interests of justice; and

4.2 You act in good faith towards Clients

Overriding Principle 5.
Deal with regulators and ombudsmen in an open and co-operative way
You comply with the Code of Conduct and the Codes which sit beneath it. You systematically identify, monitor
and manage risks to delivery of the Code’s Outcomes and notify the CLC of any breach of it (by you or another).

You are open and honest with us. You notify us of a change set out in the CLC’s Notification Code. You comply with the authorisations, permissions and any conditions of your licence. You comply with a CLC direction/request and co-operate with any CLC investigation. You obtain our permission before offering Reserved Legal Activities as a new business, in an entity regulated by another regulator, or which has a manager who isn’t a Licensed Conveyancer.

You co-operate with other regulators and ombudsmen. You comply with a Legal Ombudsman Order. If a CLC licensee operating in an entity regulated by another regulator you comply with their regulatory requirements in a way reasonably consistent with this Code.

You make your specified Compensation Fund contribution. You promptly notify us of any facts/ matters which may give rise to a Compensation Fund claim. You promptly notify insurers of any facts/matters which may give rise to a PII claim.

In doing so, you should deliver the following Outcome:

5.1 You act in accordance with your regulatory responsibilities.

Overriding Principle 6.
Promote equality of access and service
You comply with Equalities legislation. You make all reasonable efforts to ensure your service is accessible and responsive to Clients, including those with vulnerabilities. You make reasonable adjustments to prevent persons with disabilities from being placed at substantial disadvantage. You investigate any allegation of discrimination, harassment or victimisation and take disciplinary action where appropriate. You provide equal employment and training opportunities.

Your complaints procedure is clear, well-publicised and free. Clients are aware from the outset of their right to make a complaint – including their right to have it escalated to the Legal Ombudsman – how to make it, and to whom. You treat complaints seriously, fairly, deal with them within 28 days, and provide appropriate redress. You keep a record of complaints received, and action taken, identifying and addressing systemic Client complaint issues.

In doing so, you should deliver the following Outcomes:

6.1 The service is accessible and responsive to the needs of individual Clients, including those who are vulnerable;

6.2 No-one – Client, employee, colleague, job applicant, trainee, or other party – you deal with feels discriminated against (whether directly or indirectly), victimised or harassed;

6.3 You accept responsibility where the service you provide is not of the expected standard and provide appropriate redress for the Client where necessary;

6.4 Handling of complaints takes proper account of Clients’ individual needs, including those who are vulnerable; and

6.5 Complaints are dealt with impartially and comprehensively.

Complaints Code

Outcomes-focused
By complaint we mean an oral or written expression of dissatisfaction which alleges that the complainant has suffered (or may suffer) financial loss, distress, inconvenience or detriment. Capturing and learning from this feedback is an essential element of overall customer care, providing a useful measurement of how well a business is meeting the needs of its clients and identifying any areas which would benefit from improvement.

As a result, all members of the CLC-regulated community must deliver the following Outcomes:

You accept responsibility where the service you provide is not of the expected standard and provide appropriate redress for the Client where necessary ( Code of Conduct Outcome 6.3);

Handling of complaints takes proper account of Clients’ individual needs, including those who are vulnerable (Code of Conduct Outcome 6.4);

Complaints are dealt with impartially and comprehensively (Code of Conduct Outcome 6.5).

What should a complaints procedure look like?
Delivery of the outcomes requires a procedure which is:
• Well-publicised; clients are advised from the outset of their right to make a complaint, including the right for this to be escalated to the Legal Ombudsman (providing its contact details and timeframes);
• Free, clear, convenient, accessible and responsive to the needs of different clients (so complaints can be made by any reasonable means);

Complaints are investigated under the supervision of a senior manager/member;

Complaints are treated seriously and dealt with constructively, fairly and comprehensively;

Complaints are acknowledged/responded to in a timely manner;

The response clearly explains the assessment of the complaint, the decision made and any remedial action/redress offered, as well as information on any review procedure in place and on the Legal Ombudsman;

Keeping a record of complaints and any action taken as a result, identifying and addressing any systemic issues.

Complaints Good Practice
The Guidance accompanying the Complaints Code provides an Example Complaints Procedure for those in need of a template. It also provides good practice examples such as provision of a Customer Feedback Form/possible survey questions should the firm decide to capture client satisfaction with the complaints procedure; and a website facility to enable online registration of a complaint. It is not mandatory for members of the CLC-regulated community to adopt any of the good practice examples cited, they are provided for consideration purposes.

Legal Ombudsman
The Legal Ombudsman, under the Legal Services Act 2007, has formal powers to resolve service related complaints about lawyers (conduct related complaints will be passed to us to deal with). It expects the complainant to have already complained to their legal service provider, allowing the firm the opportunity to resolve the complaint in the first instance. It can accept complaints up to 6 months after the complaint has completed its journey through the firm’s procedure or within 12 months of the complainant discovering a problem (whichever is later). It charges firms a £400 case fee for every 3rd – and any subsequent upheld – complaint over a 12 month period. It can also award costs.

Equality Code

Outcomes – focused
All members of the CLC-regulated community must deliver the following Outcomes:

The service is accessible and responsive to the need of individual Clients, including those who are vulnerable (Code of Conduct Outcome 6.1);

No-one – Client, employee, colleague, job applicant, employee or other party – you deal with feels discriminated against (whether directly or indirectly), victimised or harassed (Code of Conduct Outcome 6.2).

This means that bodies must comply with Equalities legislation, providing equal opportunities for access, service, employment and training; making reasonable adjustments to prevent disabled persons from being placed at a substantial disadvantage; making all reasonable efforts to ensure the service is accessible and responsive to all clients; and investigating thoroughly – and disciplining as appropriate – any allegation of discrimination, victimisation or harassment.

What is meant by a ‘vulnerable’ client?
Members of the public seeking provision of legal services are often vulnerable and/or distressed due to the very circumstances which have caused them to seek the service. They can also be vulnerable due to a range of characteristics such as low-literacy levels; limited knowledge of, or limited skills in, use of English; lack of knowledge of legal entitlements; and disability. Vulnerability can only be assessed on a case-by-case basis.

Equality Act 2010 – an overview
A service provider must not discriminate, harass or victimise any member of the public requiring the service. Employers, (proposed and actual) firms and Limited Liability Partnerships, must not discriminate, harass or victimise any person in their employment/partner arrangements, offers, terms, and opportunities for promotion, transfer, training or other benefit, facility or service. Employers are responsible for the actions of their employees; managers are responsible for the
actions of agents.

Discrimination is when a person is treated less favourably, or an unjustifiable requirement/condition
has a disproportionately adverse effect on a group, because of age, disability, gender reassignment, marital or civil partnership status, pregnancy or maternity, race, religion or faith, sex or sexual orientation; these are known as the ‘protected characteristics’. A person perceived to have a protected characteristic or who is associated with someone who has a protected characteristic is also protected from discrimination e.g. carers.

A reasonable adjustment means the removal of barriers which would place a disabled person at a substantial disadvantage, or would cause an unreasonably adverse experience, to a person without a disability. An adjustment can be a one-off – e.g. adjusting a physical feature so the premises are more accessible or providing special computer software for a disabled employee – or an adjustment made on numerous occasions – such as making information available in an accessible format such as large print, or visiting a client at home if they are unable to access your premises.

Terms in contracts, collective agreements or rule of undertakings are unenforceable/void if they result in unlawful discrimination or victimisation. There is limited enforceability of pay secrecy clauses.

The end of a service or employment relationship must not give rise to discrimination or harassment. In some circumstances, employers are explicitly liable for harassment by third parties in the workplace. A body covered under the Act should not instruct, cause, induce, or aid, another party
to contravene their own responsibilities under the Act.
Unless made for prescribed relevant reasons job applicants cannot be asked questions related to health or disability prior to being offered a position.

Tribunals can make recommendations affecting all of an employer’s staff, not just the claimant.

This section provides only an overview of the Act’s provisions. You should make yourself familiar with the Act itself.

Licensed Body (ABS) Licensing Code

Monitoring
We systematically collect information – such as Continuing Professional Development Records, changes in stakeholders; complaints information – to help us monitor whether the bodies we regulate are delivering the Outcomes our regulatory arrangements seek. According to the risk this information identifies we may require information more frequently (and varied). The investigation may include an inspection carried out remotely or through a site visit. All successful CLC applicants must sign up to the CLC Co-operation with Inspection Declaration to enable this process.

Enforcement
Where a regulated body, or stakeholder of it, fails to comply with its/their regulatory responsibilities we will seek to informally resolve the issue wherever possible. Where this has failed, or is not appropriate due to the severity of the risk, we will take formal enforcement action. Our formal enforcement powers include:

Licence conditions – imposed where additional safeguards are required; usually take the form of us requiring the body, or a stakeholder of it, to take a specified step; Where a regulated body, or stakeholder of it, fails toc omply with its/their regulatory responsibilities we will seek to informally resolve the issue wherever possible. Where this has failed, or is not appropriate due to the severity of the risk, we will take formal enforcement action. Our formal enforcement powers include:

Licence conditions – imposed where additional safeguards are required; usually take the form of us requiring the body, or a stakeholder of it, to take a specified step;

Financial penalties – imposed upon the body itself (up to £250 million), and/or a stakeholder of it (a manager or employee can be fined up to £50 million); likely to be issued when behaviour is inappropriate and needs to be changed; the amount will be proportionate to the breach and the body’s resources;

Disqualification* – we are likely to disqualify a HoLP, HoFA, manager or employee found to have intentionally, or through neglect, significantly breached their duties, or who has caused, or substantially contributed to a significant breach of the licence terms, from assuming that role in any Licensed Body; depending upon the circumstances they may be disqualified from any role;

Divestiture – we are likely to apply to the High Court for a person to be divested of their material interest holding where they have acquired it without having secured our approval of it, the conditions on it have been breached or our objection to the interest disregarded;

Licence suspension and/or revocation – this decision will not be taken lightly and will only be imposed where there are no other options available due to the severity of the risk presented (please see 13.22 of the Framework for instances in which a licence may be suspended/revoked); where needed we will appoint an agent to organise the formal closure of the business i.e. intervene. [Disqualification* – the Legal Services Board (the oversight regulator) maintains a list of individuals disqualified; should a body employ a disqualified person we can suspend/revoke the body’s licence.]

Review/appeal of CLC licensing and enforcement decisions
Should an applicant body (or individual stakeholder* of it) be aggrieved at a CLC licensing determination, or a CLC Licensed Body (or individual stakeholder* of it) be aggrieved at CLC enforcement decision, they have the right to request a review of the decision. This will be carried out by a Panel/Committee which does not include any members of CLC staff/anyone involved in the original determination. Should the body/ individual remain aggrieved they have the right of appeal to the First-Tier Tribunal. [* Owner, HoLP, HoFA, manager or employee]

Transfer and Continuity of Licences
Should a member of a Limited Liability Partnership of two members, or a HoLP or HoFA, become unsuitable for, or leave, the role, the licence will continue in full force and effect provided an appropriate replacement is in place within 28 days (this may be extended upon request). Where there is a change in ownership under item 16.5 of the Framework the CLC may determine that the licence will continue in effect, be transferred or a temporary licence issued (endorsed with or without new authorisations, permissions and conditions). Should the licence’s endorsements not be met the CLC may suspend the licence, it may cease to have effect or may be revoked.

Alternative Business Structures (ABS)
ABS provide reserved legal activities, often alongside other associated activities, and can be owned and managed by non-lawyers. For licensing purposes they are known as Licensed Bodies. The body must have a Head of Legal Practice (HoLP) who is a lawyer, a Head of Finance and Administration (HoFA; does not have to be a lawyer) and at least one lawyer who is authorised to deliver the reserved legal activity which the body proposes to deliver (this may be the HoLP). It must have a practising address in England and Wales – though its owner does not have to be so based – and have Professional Indemnity Insurance approved by the CLC (should the cover not be obtained through the CLC’s Master Policy). All Licensed Bodies will be required to make a contribution to the CLC Compensation Fund.

Applications to become an ABS licensed by the CLC
We need to be able to determine if an applicant body is fit to provide legal services to the public. Applicants must provide us with Statements regarding how the body will ensure it delivers the Outcomes cited in the CLC Code of Conduct and comply with the CLC Licensed Body Code; and how licensing it would improve access to justice (e.g. extended opening hours, cheaper prices, online provision). Information on arrangements – such as regulatory notifications to the CLC; provision of activities; conflicts of interest and improper influence; governance and management; handling of both client monies and client complaints; and employment (how to ensure the body employs only fit and proper persons) – will help inform our assessment. As will financial data such as the body’s Business Plan, financial forecasts and proof of funding source.

We need to know whether the proposed owner(s) is fit to own and the proposed managers fit to manage. Therefore we will require fit and proper declarations – including criminal convictions, disqualifications and any bankruptcy events – from the persons with, or proposing to have, 10% or more material interest in the body (this includes any associates of 3% or more interest e.g. an owner has 8% shares and their spouse or civil partner has 4%, taken together they hold more than 10% interest ); the managers (including the HoLP and HoFA); and from lawyers to be employed by the body.

We also require diversity profiles of the body – i.e. the age, gender, ethnicity etc. breakdown of staff – so we can obtain an overview of the composition of the CLC-regulated legal workforce. This is for information purposes only; it will not inform our assessment of the applicant body. Applicant bodies can also provide us with supplementary information on how they actively promote the CLC Outcomes should they wish to do so.

Application determination timescales and fees
We aim to determine all applications within 90 days of receipt, though we reserve the right to extend this, by up to another 90 days, where needed due to a complex application. Applications from Recognised Bodies currently regulated by us, which – due to their ownership/management structure – need to become ABS, will have their applications fast-tracked and should be advised of our determination within 42 days (this can be extended up to 90 days should major changes of ownership have been made).

The standard application fee for a new applicant is £1200 (£600 for CLC Recognised Bodies as we already have a range of information on these entities). The applicant body will be charged for the data verification of stakeholders’ fit and proper declarations. We shall notify applicants at the time of making their application of the current prices. We reserve the right to also verify the declarations of Authorised Persons and associates where deemed appropriate.

Application determination
Applications will be determined in light of the risks presented to the Code of Conduct Outcomes through assessment of factors such as the body’s activities (and whether the non-reserved legal activities are closely related to those which are reserved, as well as the quality of the proposed arrangements for delivery of both reserved and non-reserved activities); its client type; the quality of its arrangements, the management level of the HoLP and HoFA; any significantly prejudicial access to justice barriers; the suitability of its declared stakeholders; and any other factors which are judged to threaten the Outcomes. Adverse fit and proper information does not automatically preclude CLC approval of the individual; this will be judged on a range of factors which inform the level of risk. This includes the proposed role of the individual, the quality of the body’s arrangements, how long ago the issue occurred etc.

Should a licence be issued it will specify its terms by way of endorsement:

Authorisations set out the reserved legal activities which the body is authorised to carry on;

Permissions set out the non-reserved legal activities which the body is permitted to provide; and

Any conditions applicable to the exercise of authorisations and permissions (conditions are imposed where we risks to the Code of Conduct Outcomes can be mitigated through such steps as specified in the conditions).

Where the risks are too significant to tolerate through the imposition of licence conditions the application will be refused.

Licensed Body Register
For both transparency and to aid public confidence in legal service providers, the register of CLC Licensed Bodies will be published on our website. This includes information such as the name and address of the body, the reserved legal activities it is authorised to carry on, the names of the HoLP, HoFA , Authorised Persons, those with a material interest and the ultimate beneficial owner.

Licence Modification
A body wishing to modify the terms of its licence must apply to us and provide evidence to justify the modification. We will only modify a licence without first obtaining consent if there is an evidenced need to do so i.e. a condition or endorsement is no longer applicable; we have identified a significant/immediate risk to Clients; or there has been a legislative or regulatory change.

Material Interests
Licensed Bodies must have arrangements in place to ensure that persons proposing to take a step which would result in them acquiring a material interest of 10% or more – or a person with an existing material interest acquiring an additional kind of interest – notify both the Licensed Body and the CLC of this. Pre-approval of the interest will be given for up to 90 days (this can be extended by another 90 days if needed), with permanent approval being granted where the owner is judged fit and proper to own.

2.2 Client matters are dealt with using care, skill and diligence; and

2.3 Appropriate arrangements, resources, procedures, skills and commitment are in place to ensure Clients always receive a high standard of service.

Overriding Principle 3.
Act in the best interests of Clients
Outcomes:

3.1 Each Client’s best interests are served;

3.2 Clients receive advice appropriate to their circumstances;

3.3 Clients have the information they need to make informed decisions;

3.4 Clients are aware of any referral arrangements and that they are consistent with your responsibilities both to them and to the CLC;

3.5 Clients are aware of any limitation or any condition resulting from your relationship with another party; and

3.6 Clients’ affairs are treated confidentially (except as required or permitted by law or with the Client’s consent).

Overriding Principle 4.
Comply with your duty to the court
(applicable should the CLC’s application to regulate litigation and advocacy be successful and you have been authorised to deliver these services.)
Outcomes:

4.1 You act in the interests of justice; and

4.2 You act in good faith towards Clients.

Overriding Principle 5.
Deal with regulators and ombudsmen in an open and co-operative way
Outcome:

5.1 You act in accordance with your regulatory responsibilities.

Overriding Principle 6.
Promote equality of access and service
Outcomes:

6.1 The service is accessible and responsive to the needs of individual Clients, including those who are vulnerable;

6.2 No-one – Client, employee, colleague, job applicant, trainee, or other party – you deal with feels discriminated against (whether directly or indirectly), victimised or harassed;

6.3 You accept responsibility where the service you provide is not of the expected standard and provide appropriate redress for the Client where necessary;

6.4 Handling of complaints takes proper account of Clients’ individual needs, including those who are vulnerable; and

6.5 Complaints are dealt with impartially and comprehensive

Handbook

CLC Handbook Introduction
The purpose of this Quick Start Guide is to give you an overview of your regulatory responsibilities as set out in the new CLC Handbook. The CLC Handbook contains:The Codes – these set out your responsibilities as an individual or entity regulated by us;Guidance – many of the Codes are accompanied by (non-mandatory) guidance as to how you can meet your regulatory responsibilities; ourRegulatory and Enforcement Policies – these outline our approach to regulation and our likely response should you not meet your regulatory responsibilities;Frameworks – these set out the parameters within which our Professional Indemnity Insurance, Compensation Fund and Continuing Professional Development provisions are implemented.

Your regulatory responsibilities – the Codes
The Code of Conduct is the umbrella Code i.e. it sets out the Overriding Principles (OP) by which you must always
comply:OP1. Act with independence and integrityOP2. Maintain high standards of workOP3. Act in the best interests of ClientsOP4. Comply with duty to the court (applicable only if you deliver litigation and advocacy services)OP5. Deal with regulators and ombudsmen in an open and co-operative wayOP6. Promote equality of access and service
and the Outcomes which you must deliver in behaving in such a principled manner (please see the Quick Start Guides to the Outcomes and the Code of Conduct for more information). The Code of Conduct is applicable to all services you are permitted/authorised by the CLC to deliver. All other Codes in the Handbook are in place to support the Code of Conduct.

Accounts Code – the most prescriptive and longest of all the Codes, this sets out the parameters within which you must operate to ensure client money is kept separately and safely. There are new provisions requiring the Office and Client accounts to be used only in relation to the provision of services regulated by the CLC; and for written records to be kept of all monies which pass through the office account whether or not they relate to a particular transaction (and
whether or not such monies have passed through it in breach of the former).

Anti-Money Laundering and Combating Terrorist Financing Code – requires you to have appropriate arrangements, systems, controls and dedicated roles in place which prevent, mitigate, detect and report these illegal practices.

Complaints Code – requires complaints procedures to be appropriately promoted, accessible to all (including those who are vulnerable), comprehensive; and sets out the timeframes within which you must respond to complaints and the information that response should contain.

Conflicts of Interest – you must not accept instructions from a person, nor continue to act for a client, whose interests conflict with your own, the entity’s, or another client, but you are able to accept instructions from clients with different interests in a matter as long as each client is represented by Authorised Persons conducting themselves as though members of different entities (and both clients have agreed, in writing, to being represented by you).

Continuing Professional Development – our licences stipulate the number of hours, and content of, training which you, or a named member of staff, must complete to ensure your knowledge remains up-to-date. This must be recorded in a training record submitted to us on an annual basis.

Dealing with Non-Authorised Persons (third parties) – you must not have dealings with any non-Authorised third person (unless there is clear evidence that the person is an Exempt Person) who is carrying on reserved legal activities. A person who is neither an Authorised nor an Exempt Person who is carrying on reserved legal activities must be reported to us.

Disclosure of Profits and Advantages – requires you, when accepting instructions or introducing a Client to another person, to inform the Client in writing of the existence of any introduction arrangement and the amount of any sum which has been, or is to be, paid in connection with it.

Equality Code – you must make reasonable adjustments, and reasonable efforts to ensure your service is accessible and responsive to Clients (including those who are vulnerable), investigate any allegation of discrimination, victimisation or harassment; and provide equal opportunities in employment and training. As these are new regulatory responsibilities we have provided a range of guidance to accompany the Code.

Estimates and Terms of Engagement – you must provide, and store on a Durable Medium, an estimate of costs and keep the Client informed where it becomes apparent that the sum payable is likely to exceed the estimate and provide an explanation for the change. Sets out the wording and information – including your contact details, the names of other relevant contacts and an explanation of the procedure to be adopted should the Client become dissatisfied with the service provided – which must be provided in the Terms of Engagement.

Management and Supervision – requires an Authorised Person Manager to be responsible for
ensuring all of your employees are properly supervised. The entity must systematically identify, monitor and manage risks to delivery of the Code of Conduct’s Outcomes. It must also make provision for alternative supervision arrangements should an unforeseen event occur; and have appropriate arrangements, controls and records to maintain proper governance, management, supervision, financial and risk management.

Notification – sets out the changes – such as structural, management, financial, disciplinary and criminal charges, cautions and convictions – in circumstance of which we must be notified and the timescales within which that notification must be made.

Professional Indemnity Insurance – when providing CLC-regulated services you must have insurance cover – obtained through the CLC Master Policy or on the open market through an Authorised Insurer – approved by us. Should your self-insured excess exceed those limits set out in the Code you must report this to us.

Undertakings – you must not breach any undertaking, nor avoid liability on it by asserting that to comply with it would be breach of duty owed to the Client or by misrepresenting other implications. The following Codes are not applicable to all members of the CLC regulated community, they apply only to those entities providing the specified service – i.e. insurance intermediary or litigation and advocacy – or which act for lenders, or are regulated by us as a Licensed Body (an ‘Alternative Business Structure’) or a Recognised Body.

Acting as Insurance Intermediaries – sets out the provisions which an entity registered on the Financial Services Authority’s Intermediaries Register must have in place.

Acting for Lenders and Mortgage Fraud – identifies the safeguards which must be employed to ensure confirmation of identity and documents and title are secured; transactions, mortgage redemption and instructions, proceeds of sale and variations in price and incentives are properly undertaken; and other material considerations are taken into account.

Licensed Body – clearly defines the responsibilities of the Head of Legal Practice, Head of Finance and Administration, managers, employees and owners to ensure all of the entity’s stakeholders are committed to it delivering the Code of Conduct’s Outcomes.

Litigation & Advocacy – supplementary provisions to those identified under the Code of Conduct’s Overriding Principle of Comply with your duty to the court which seek to ensure the other 5 Overriding Principles are upheld at all times in relation to the provision of litigation and advocacy.

Recognised Body – clearly defines the responsibilities of managers and other stakeholders to ensure all of the entity’s stakeholders are committed to it delivering the Code of Conduct’s Outcomes.

CLC Regulatory and Enforcement Policies
Our Regulatory and Enforcement Policies set out how we will be accountable, consistent, proportionate, transparent and targeted in seeking to achieve our 3 key regulatory aims:

Those we regulate deliver high standards of service to consumers and to the wider public;

There are high standards of conduct amongst those we regulate; and

There is an effective and proportionate regulatory framework in operation.

They explain how we identify and respond to non-compliance with regulatory responsibilities. Where possible/appropriate we will take an informal approach but where delivery of a Code of Conduct Outcome is at significant risk we will take formal enforcement action. We will employ the civil standard of proof.

We have a range of formal enforcement tools at our disposal. These can be used in isolation or conjunction and include: the issuing of a reprimand; imposing a penalty or condition; withdrawing our approval of, or disqualifying, an individual; and suspension/ revocation of a licence. Where formal enforcement action is taken we will provide you with clear reasons for the decision at the time the action is determined.

The enforcement may be targeted at the CLC-regulated entity or an individual stakeholder of it, or both. We will publish the formal enforcement decisions of our committees where there a case to answer has been found. We will name the respondent where the penalty exceeds £5,000, an individual has been disqualified or our approval of them withdrawn, or their licence has been suspended or revoked.

Frameworks
Sets out the parameters within which we operate the CLC Compensation Fund, Professional Indemnity Insurance
provisions and the Continuing Professional Development scheme.

The frameworks under which students are trained and applicants licensed are provided in the CLC Frameworks document (alongside copies of those provided in the Handbook). They are not provided in the Handbook as it covers only the arrangements applicable to entities and individuals already regulated by us.